PEFINDO assigns “idA1+” rating for PT Jasa Marga (Persero) Tbk’s Commercial Paper

(October 1, 2020)--PEFINDO has assigned its “idA1+” rating for PT Jasa Marga (Persero) Tbk (JSMR)’s Commercial Paper Year 2020 up to IDR1 trillion, which will be used for financing purpose. PEFINDO has also affirmed its “idAA-” ratings for JSMR and JSMR’s Shelf Registered Bond II Year 2020 of up to IDR4.5 trillion and Bond XIV Series JM-10 Year 2010. The outlook for the corporate rating is “stable”.

An obligor rated idAA differs from the highest rated obligors only to a small degree, and has a very strong capacity to meet its long-term financial commitments relative to that of other Indonesian obligors. The Minus (-) sign indicates that the rating is relatively weak within the respective rating category.

A short-term debt security rated idA1+ has the highest rating category assigned by PEFINDO. The obligor’s capacity to meet its shortterm commitments on the debt security, relative to other Indonesian obligors, is superior.

The corporate rating reflects strong government support for completing toll road projects, JSMR’s dominant position in the toll road sector, its diversified toll road portfolio with long concession period, and its strong financial flexibility. The rating is constrained by its more aggressive capital structure in the near to medium term and business risks related to the development of new toll roads.

The rating will be raised if the Company improves its capital structure by deleveraging its debt, if its new toll roads are successfully operated as scheduled and consistently attract high traffic volume as projected, or if we view a stronger government support. The rating will be lowered if the pandemic-related restrictions are prolonged to the second half of the year, resulting in significantly lower toll revenue than anticipated; if it fails to obtain additional loan facilities to address the refinancing risk; or if its more aggressive capital structure is not compensated by an improving business performance, which could weaken its cash flow protection measures.

JSMR is the largest toll road operator in Indonesia. Its portfolio includes 13 old toll road concessions (Jagorawi, Jakarta-Tangerang, Ulujami-Pondok Aren, Jakarta Inner Ring Road (Cawang-Tomang-Pluit), Prof. Dr. Sedyatmo, Jakarta-Cikampek, Jakarta Outer Ring Road/JORR, Cikampek-Padalarang, Padaleunyi, Palikanci, Semarang, Surabaya-Gempol, and Belmera), 12 fully operated toll roads at subsidiaries (Nusa Dua-Ngurah Rai-Benoa, JORR W2N, Surabaya-Mojokerto, Solo-Ngawi, Semarang-Solo, Gempol-Pasuruan, BatangSemarang, Medan-Kualanamu-Tebing Tinggi, Gempol-Pandaan, Kunciran-Serpong, Jakarta-Cikampek II Elevated, and Pandaan-Malang), and 3 partially operated toll roads (Bogor Ring Road, Ngawi-Kertosono-Kediri, and Balikpapan-Samarinda). It is also in the process of land acquisition and construction on 5 toll road projects at subsidiaries (Cengkareng-Kunciran, Serpong-Cinere, Jakarta-Cikampek II South, Manado-Bitung, and Probolinggo-Banyuwangi). As of December 31, 2019, its shareholders were the Indonesian government (70.0%), BPJS Ketenagakerjaan (3.4%), PT Taspen (2.2%), and the public (24.4%). (ends)